According to the Washington Post, it’s not a “death tax,” it’s a “posthumous federal levy on accumulated wealth.” So there.

Over the years, I’ve shared some outrageous examples of overpaid bureaucrats.

• The chief bureaucrat of a low-income California city getting almost $800,000 per year.
• Cops in Oakland getting average compensation of $188,000.
• A school superintendent in New York raking in more than $500,000 of annual compensation.
• A Philadelphia bureaucrat, after working only two and a half years, nailing down a guaranteed pension of $50,000 per year.
• A New York school bureaucrat simultaneously getting a $225,000 salary and $300,000 pension.
• California taxpayers being forced to pay a fired bureaucrat $550,000 for unused vacation time.
• An employee of the New Jersey Turnpike system raking in annual compensation of $320,000.

Hopefully we’re all disgusted when insiders rig the system to rip off taxpayers. And I suspect you’re not surprised to see that the worst example on that list comes from California, which is in a race with Illinois to see which state can become the Greece of America.

Well, the Golden State has a new über-bureaucrat. Here are some of the jaw-dropping details from a Bloomberg report.

The numbers are even larger in California, where a state psychiatrist was paid $822,000, a highway patrol officer collected $484,000 in pay and pension benefits and 17 employees got checks of more than $200,000 for unused vacation and leave. The best-paid staff in other states earned far less for the same work, according to the data.

Wow, $822,000 for a state psychiatrist. Not bad for government work. So what is Governor Jerry Brown doing to fix the mess? As you might expect, he’s part of the problem.

…the state’s highest-paid employees make far more than comparable workers elsewhere in almost all job and wage categories, from public safety to health care, base pay to overtime. …California has set a pattern of lax management, inefficient operations and out-of-control costs. …In California, Governor Jerry Brown hasn’t curbed overtime expenses that lead the 12 largest states or limited payments for accumulated vacation time that allowed one employee to collect $609,000 at retirement in 2011. …Last year, Brown waived a cap on accrued leave for prison guards while granting them additional paid days off. California’s liability for the unused leave of its state workers has more than doubled in eight years, to $3.9 billion in 2011, from $1.4 billion in 2003, according to the state’s annual financial reports. …The per-worker costs of delivering services in California vastly exceed those even in New York, New Jersey, Illinois and Ohio.

Actually, it’s not just that he’s part of the problem. He’s making things worse, having seduced voters into approving a ballot measure to dramatically increase the tax burden on the upper-income taxpayers.

I suppose the silver lining to that dark cloud is that many bureaucrats now rank as part of the top 1 percent, so they’ll have to recycle some of their loot back to the political vultures in Sacramento.

But the biggest impact of the tax hike—as shown in the Ramirez cartoon—will be to accelerate the shift of entrepreneurs, investors, and small business owners to states that don’t steal as much. Indeed, a study from the Manhattan Institute looks at the exodus to lower-tax states.

The data also reveal the motives that drive individuals and businesses to leave California. One of these, of course, is work. …Taxation also appears to be a factor, especially as it contributes to the business climate and, in turn, jobs. Most of the destination states favored by Californians have lower taxes. States that have gained the most at California’s expense are rated as having better business climates. The data suggest that many cost drivers—taxes, regulations, the high price of housing and commercial real estate, costly electricity, union power, and high labor costs—are prompting businesses to locate outside California, thus helping to drive the exodus.

Yet another example of why tax competition is such an important force for economic liberalization. It punishes governments that are too greedy and gives taxpayers a chance to protect their property from the looter class.

Postmaster General Michael Donahoe has occasionally remarked that the U.S. Postal Service will end up in a Greek-like crisis if Congress doesn’t allow it to reduce costs and operate with more flexibility. Michael Schuyler, now with the Tax Foundation, examines the analogy between Greece and the USPS in a paper that was released on Monday.

The “good” news for the USPS is that its fiscal situation isn’t as bad as what the Greeks are dealing with—at least not yet. Whereas previous Greek governments intentionally understated deficits and debt until it caught up to the country in 2009, the USPS hasn’t tried to hide the fact that its prospects are bleak. In addition, the USPS has been able to shed excess workers (through attrition) over the past several years, while recent attempts by the Greek government to cut its bloated workforce have been met with rioting.

The problem is that powerful interests maintain convenient opinions on some of biggest issues facing the USPS. Mike singles out for particular scrutiny the postal employee unions for continuing to pretend that the USPS would be alright if it didn’t have to make annual payments to “prefund” retiree health care benefits. Both of us have been critical of this claim, but I think Mike’s latest reality check is worth sharing in its entirety:

If Congress did not require the Service to put aside money to pay the costly health benefits it promises its workers after they retire, the deficits it reported in the last several years would have been substantially reduced and so would its reported deficits in the near future. Some stakeholders claim from this that the Service’s problems are artificial, the fault of a funding requirement Congress imposed in 2006 as part of the Postal Accountability and Enhancement Act (PAEA, P.L. 109–435). They assert that the Service is, in reality, in fairly good shape. For example, Fredric Rolando, president of the National Association of Letter Carriers, declared, “The Postal Service has performed well in operational terms, nearly breaking even despite the worst recession in 80 years.” It should be noted, however, that even if the RHBF is entirely ignored, the Service would have lost $4.8 billion in 2012, $5.1 billion in 2011, $3.0 billion in 2010, and $2.4 billion in 2009. Losses of $4.8 billion, $5.1 billion, $3.0 billion, and $2.4 billion caused by problems other than the RHBF do not equal performing well. No wonder Postmaster General Donahoe characterized as “irresponsible” the argument that the Service would be fine except for retiree health benefit contributions and said, “The idea that if we just eliminate the prefunding…we’ll be OK—wrong!”

Mr. Rolando and others also argue that because the RHBF “already has $45 billion [of assets], enough to pay for decades of future retiree health care,” Congress should not require the Service to make further contributions. The flaw in that argument is that although its projected assets in the fund were $45.7 billion at the end of 2012, its projected liabilities were $93.6 billion, leaving an unfunded liability of $47.8 billion. If Congress let it cease contributing to the retiree health fund without also enacting reforms to dramatically reduce projected liabilities, it would virtually guarantee a huge taxpayer bailout of the Service down the road. The call for a prolonged contribution holiday is reminiscent of the approach that has landed the Greeks in so much trouble.

Never mind the fact that we’re talking about a benefit that a small and shrinking number of private sector workers are offered.

There’s one more point that Mike makes that I found interesting. He notes that defenders of the status quo often accuse USPS management and certain members of Congress of pushing for reforms that will ultimately lead to postal privatization. But Mike argues that reforms that would help fix the USPS’s financial imbalances would make privatization less likely:

[O]ne of the major postal reforms bills in Congress, the Postal Reform Act of 2011 (H.R. 2309), is often accused of paving the way for privatization. In fact, it would do the opposite. The House bill takes a tough-love approach and contains several controversial provisions. These include the creation of a Commission on Postal Reorganization Act, modeled on the successful military Base Realignment and Closure (BRAC) Commissions, as well as the creation of a Financial Responsibility and Management Assistance Authority, modeled on the effective District of Columbia Financial Control Board. No position is taken here on whether those provisions ought to be part of postal reform, but it should be noted that BRAC Commissions have saved the military billions of dollars and the DC Financial Control Board helped revitalize the District of Columbia. Those earlier, bipartisan efforts were not intended to privatize the Defense Department or the District; the goal was to help government run better.

Hmmm… I don’t want government to “run better.” And I think the U.S. Postal Service should be privatized regardless of how it’s run or the state of its finances. So if Mike’s right, perhaps free-market fans should be hoping that the USPS goes the way of Greece. After all, because Greece’s finances are such a mess, privatization of Hellenic Post is now on the table.

The danger, of course, is that Congress would just bail it out with taxpayer money.

I’m understandably partial to my video debunking Keynesian economics, and I think this Econ 101 video from the Center for Freedom and Prosperity does a great job of showing why consumer spending is a consequence of growth, not the driver.

But for entertainment value, this very funny video from Econ​Sto​ries​.tv puts them to shame while also making important points about what causes economic growth.

The video was produced by John Papola, who was one of the creators of the famous Hayek v Keynes rap video, as well as its equally clever sequel.

Conservatives are hammering House Speaker John Boehner over the purging of reliably limited government Republicans who weren’t afraid to buck the GOP leadership. But what about Paul Ryan?

There were two Republicans on the House Budget Committee – chaired by Ryan – who voted against Ryan’s budget last spring: Rep. Justin Amash and Rep. Tim Huelskamp. Amash and Huelskamp were just kicked off the Budget Committee, which Ryan is going to continue to chair.

Now consider this quote from an unnamed House GOP leadership aid as reported by The Hill: “Changes are made for a variety of reasons, most often at the request of committee chairs.” That makes it pretty clear that Ryan played a role – if not the role – in getting rid of Amash and Huelskamp. Yet – to my knowledge – conservatives haven’t trained any of their fire on Ryan.

How come?

I’ve repeatedly tried to expose pervasive fiscal dishonesty in Washington.

In these John Stossel and Judge Napolitano interviews, for instance, I explain that the crooks in DC have created a system that allows them to claim they’re cutting the budget when the burden of government spending actually is rising.

This sleazy system is designed in part to deceive the American people, and the current squabbling over the fiscal cliff is a good example. The President claims he has a “balanced approach” that involves budget cuts, but look at the second chart at this link and you will see that he’s really proposing bigger government.

This dishonest approach also was used by the President’s Fiscal Commission and last year’s crummy debt limit deal was based on this form of fiscal prevarication.

Here are some key excerpts from a Wall Street Journal editorial exposing this scam.

…President Obama and John Boehner are playing by the dysfunctional Beltway rules. The rules work if you like bigger government, but Republicans need a new strategy, which starts by exposing the rigged game of “baseline budgeting.” …numbers have no real meaning because they are conjured in the wilderness of mirrors that is the federal budget process. Since 1974, Capitol Hill’s “baseline” has automatically increased spending every year according to Congressional Budget Office projections, which means before anyone has submitted a budget or cast a single vote. Tax and spending changes are then measured off that inflated baseline, not in absolute terms. …Democrats designed this system to make it easier to defend annual spending increases and to portray any reduction in the baseline as a spending “cut.” Chris Wallace called Timothy Geithner on this “gimmick” on “Fox News Sunday” this week, only to have the Treasury Secretary insist it’s real. …in the current debate the GOP is putting itself at a major disadvantage by negotiating off the phony baseline. …If Republicans really want to slow the growth in spending, they need to stop playing by Beltway rules and start explaining to America why Mr. Obama keeps saying he’s cutting spending even as spending and deficits keep going up and up and up.

You probably won’t be surprised to learn that other nations rely on this crooked system, most notably the United Kingdom, which supposedly is imposing “savage” cuts even though government spending keeps rising (and they fooled Paul Krugman, though he seems to make a habit of misreading foreign fiscal and economic data).

But let’s return to the American fiscal situation. Republicans almost certainly will lose the battle over the fiscal cliff because they meekly are playing cards with a rigged deck controlled by the other side.

They should expose this scam by using nominal numbers and looking at year-over-year changes in both taxes and spending. I did that last year and showed how simple it is to balance the budget in a short period of time.

They key thing to understand is that (barring a recession) tax revenues rise every year. Indeed, the Congressional Budget Office projects that tax revenue will climb by an average of more than 6 percent annually over the next 10 years — even if the 2001 and 2003 tax cuts are made permanent.

So all that’s really needed to bring red ink under control is a modest bit of spending restraint. This video is from 2010, but the analysis is still completely relevant today.

It’s amazing how good things happen when you follow the Golden Rule of fiscal policy.

In December 2010, I wrote that “An indicator of the incoming House Republican majority’s seriousness about cutting spending will be which members the party selects to head the various committees.” The final roster ended up leaving a lot to be desired from a limited government perspective. For example, the House Republican leadership and its allies went with Rep. Hal Rogers (R‑KY), aka “The Prince of Pork,” to head up the Appropriations Committee.

Two years later, the committee situation is about to get even worse now that the House Republican leadership has decided to send a message that casting a vote according to one’s beliefs instead of one’s instructions is a punishable offense. On Monday, four congressmen were booted from “plum” committee assignments for failing to sufficiently toe the leadership line. I suspect that the purge was motivated, at least in part, by Team Boehner’s desire to have the rest of the rank and file think twice before casting a “no” vote on whatever lousy deal is struck with the White House to avoid the “fiscal cliff.”

Three of the purged Republicans are returning members of the 2010 freshmen “Tea Party Class”: Rep. David Schweikert (R‑AZ), Justin Amash (R‑MI), and Tim Huelskamp (R‑KS). Over the past year, I have been keeping a loose record of how the freshmen voted on opportunities to eliminate programs and prevent spending increases. On seven particularly telling votes*, Schweikert and Amash voted in favor of limited government every time. Out of 87 freshmen, only Schweikert, Amash, and five others had a perfect record. Huelskamp was six for seven. He also was one of only four Republicans on the House Agriculture Committee to vote against the bloated farm bill that passed out of the committee in July. The fourth outcast, Rep. Walter Jones (R‑NC), had become an irritant to the Republican establishment after turning against the Iraq War and associating himself with more libertarian Republicans like Rep. Ron Paul (R‑TX).

The best that can be said for Team Boehner thus far is that it isn’t Team Pelosi. A common excuse is that House Republicans have been constrained by Democratic control of the Senate and White House. While there is an element of truth to that claim, we’re talking about a House Republican majority that wouldn’t even vote to get rid of the loan guarantee program that led to the Solyndra debacle. The reality is that most Republicans were only ever interested in using Solyndra to score political points against the White House. Ditto pretty much every other White House spending endeavor that House Republicans claim to oppose.

*Votes were to terminate the Economic Development Administration, Advanced Manufacturing Technology Consortia, Essential Air Service program, Title 17 Energy Loan Guarantees, Community Block Development Grant program, against reauthorizing the Export-Import Bank, and against the Continuing Appropriations Act in September.